The Incredible Q1 FY25 Revenue and Profits of Adani Power
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Strong Q1 FY25 Results for Adani Power: Increased Sales and Profit
A major participant in the Indian power industry and a member of the Adani portfolio, Adani Power Ltd., has announced its financial results for the first quarter of FY25, which ends on June 30, 2024. The organization has demonstrated an impressive expansion in multiple fiscal indicators, signifying a strong output. This article explores the salient features of Adani Power’s Q1 FY25 performance, including a thorough synopsis of the business’s operational and financial accomplishments as well as its future goals.
Outstanding Growth in Sales and Profits
The ongoing revenue of Adani Power increased by 30% year over year in Q1 FY25 to Rs. 15,052 crore from Rs. 11,612 crore in Q1 FY24. Earnings Before Interest, Taxes, Depreciation, and Amortisation, or EBITDA, continued to rise significantly for the company, rising by 53% to Rs. 6,290 Crore from Rs. 4,121 Crore during the same time previous year. Furthermore, the ongoing Profit Before Tax (PBT) increased from Rs. 2,303 Crore in Q1 FY24 to an amazing Rs. 4,483 Crore.
Increase in Power Sales Volume
A 38% rise from 17.5 billion units (BU) in Q1 FY24 to 24.1 billion units (BU) in Q1 FY25 was reported by Adani Power for its combined power sales volume. The main factor for this growth was increased power demand. both a rise in effective operating capacity and demand. The company’s revenue rise was mostly attributed to the higher sales volumes.
Statement from the CEO
The CEO of Adani Power Limited, Mr. S B Khyalia, expressed hope for the future of the business. To secure the execution pipelines for three 1,600 MW Ultra-supercritical projects, he outlined Adani Power’s strategic plans. The purpose of these projects is to get ready for the predicted recovery in the thermal power industry. Mr. Khyalia underlined the company’s emphasis on securing access to fuel resources, leveraging their vast knowledge and multi-domain expertise, exploiting high-efficiency, low-emission technologies, and boosting organizational agility and competitiveness in the digitalized world. He restated Adani Power’s pledge to supply dependable, reasonably priced, and sustainable power while acting as a good steward of the environment and the communities in which it operates.
Functional Efficiency
The effective installed capacity of the company rose from 14,468 MW in Q1 FY24 to 15,250 MW in Q1 FY25. Over the same period the previous year, the Plant Load Factor (PLF) increased to 78.0% from 60.1%. The increased power demand throughout India is reflected in the units sold, which increased to 24.1 BU from 17.5 BU.
High Indian Power Consumption
India’s first-quarter power demand increased significantly, reaching a record-breaking 250 GW. Year-over-year, overall power demand increased by 10.6%, while peak demand increased by 12%. Higher offtake from Adani Power’s plants, both from contracted capabilities and open capacities, resulted from this advantageous climate for the electricity sector.
All Plants Perform
Nearly all plants contributed higher volumes, with the Godda plant, Mundra, and Mahan leading the way. On June 26, 2023, the Godda plant’s second 800 MW unit was put into service. Falling import coal costs further bolstered the rising domestic power demand and encouraged offtake under Power Purchase Agreements (PPAs).
Cash Management
The first quarter of FY25 financial performance for Adani Power shows a notable increase in several areas. While continuing other income climbed by 38% to Rs. 335 Crore, continuing revenue from operations increased by 29% to Rs. 14,717 Crore. To Rs. 15,052 crore, the total ongoing income increased by 30%. However, because of a loss in revenue, the total reported income dropped by 15% to Rs. 15,474 Crore. drop in income recognition for the prior period due to the late payment surcharge and coal shortfall claims.
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EBITDA and Pre-tax Profit
The Q1 FY25 ongoing EBITDA increased by 53% to Rs. 6,290 Crore from Rs. 4,121 Crore in Q1 FY24, mostly as a result of lower import fuel prices and greater revenues. Profit Before Tax (PBT) increased impressively by 95% to Rs. 4,483 crore from Rs. 2,303 crore in Q1 FY24, primarily due to decreased financing costs and better performance across key criteria.
Due to the addition of Unit II of the Godda Ultra-supercritical Thermal Power Plant (USCTPP), the depreciation charge for Q1 FY25 increased to Rs. 996 Crore from Rs. 935 Crore in Q1 FY24. Because of fewer borrowings and lower interest rates, the finance cost decreased to Rs. 811 crore from Rs. 883 crore in Q1 FY24.
Revenue Recognition and Regulatory Certainty
After resolving significant regulatory concerns and recovering regulatory dues during FY 2023–2024, Adani Power has entered an era of increased regulatory certainty. As a result, there has been a notable decline in revenue recognition from previous periods due to regulatory orders. Regulatory-related prior period items totaling Rs. 422 crores were included in the reported sales of Rs. 15,474 crores for Q1 FY25, as opposed to Rs. 6,497 crores for Q1 FY24.
Performance in ESG
In terms of Environmental, Social, and Governance (ESG) performance, Adani Power has achieved notable progress. Together with its third Business Responsibility Sustainability Report (BRSR), the firm released its first Integrated Annual Report under Integrated Reporting (IR) standards. The Carbon Disclosure Project (CDP) continued to award Adani Power a B grade for meeting its commitments to water security and climate change. Furthermore, the company outperformed the average score of 34/100 for World Electric Utilities in the Corporate Sustainability Assessment (CSA) conducted by S&P Global, scoring 48/100. Additionally, the company outperformed the industry average globally in January 2024 with an 88% score in the CSR HUB ESG Rating.
Plans and Developments for the Future
Adani Power is assiduously working towards realising its goal of enhancing energy security. The National Company Law Tribunal (NCLT) has received a Scheme of Amalgamation from the company’s subsidiary, Mahan Energen Limited (MEL), proposing to combine itself with Stratatech Mineral Resources Pvt. Ltd. (SMRPL), a fully owned subsidiary of Adani Enterprises Ltd. The Dhirauli Coal Mine has a peak-rated capacity of producing 6.5 million tonnes of coal yearly; its allocation is SMRPL. The MEL thermal power station in Singrauli, Madhya Pradesh, is not far from this coal mine.
Projects for Acquisition and Expansion
Adani Infra (India) Ltd. has sold Mirzapur Thermal Energy U.P. Pvt. Ltd. (MTEUPL) to Adani Power. MTEUPL possesses land in Uttar Pradesh’s Mirzapur District that is appropriate for the construction of a sizable thermal power plant. In keeping with its long-term plan, this acquisition gives the business the chance to increase both its generating capacity and its geographic footprint in India.
At its current 1,370 MW plant in Raipur, Chhattisgarh, the business has also started developing a 2×800 MW (1600 MW) Ultra-supercritical Thermal Power Plant (USCTPP) expansion project. Additionally, advance ordering for a greenfield 2×800 MW (1600 MW) USCTPP at Mirzapur, Uttar Pradesh, has started at the company’s fully-owned subsidiary, MTEUPL.
Adani Power’s strong financial performance in Q1 FY25 is a testament to the company’s strategic initiatives and operational excellence. With a focus on sustainable growth, advanced technological adoption, and responsible environmental stewardship, Adani Power is well-positioned to continue its upward trajectory. The company’s proactive measures to secure future projects and expand its capacity highlight its commitment to ensuring India’s energy security and providing reliable power to its consumers. As Adani Power navigates the evolving power sector landscape, its emphasis on innovation, efficiency, and sustainability will remain key drivers of its success.
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